Ocwen finalizes acquisition of Homeward Residential
Mortgage servicer Ocwen Financial Corp. (OCN) has finalized its acquisition of Homeward Residential Holdings Inc., a company organized by private equity firm WL Ross & Co. in 2007.
In a securities filing, Ocwen said it paid $243 million plus the book value amount of Homeward and its subsidiaries, making the aggregate purchase amount reach $766 million. About $604 million was paid in cash, Ocwen said in a securities filing. Another $162 million was paid in preferred stock.
The two firms announced the planned acquisition back in October when Ocwen said it would pay approximately $588 million in cash and $162 million in convertible preferred stock for Homeward Residential Holdings Inc. and its loan servicing and origination subsidiaries.
Homeward Residential brings with it approximately 422,000 mortgages with an unpaid principal balance of over $77 billion. The deal was officially finalized Dec. 27.
The closing of the sale wraps up a year in which Ocwen was on the prowl for mortgage servicing rights. Ocwen in partnership with Walter Investment Management (WAC) previously won a highly publicized bid for MSRs belonging to Residential Capital out of bankruptcy.
Ocwen's series of acquisitions prompted the New York Superintendent of Financial Services to require the servicer to select a monitor to oversee servicing practices for two years. The regulator made the appointment a condition to move forward with the Homeward Residential and ResCap acquisitions.